Earnings Call: Q1 2021

Apr 19, 2021

Ladies and gentlemen, thank you for standing by, and welcome to First Quarter 2020 from Faurecia. I would now like to hand the conference over to your speaker today, Michel Fabre. Please go ahead, sir. Thank you. Good morning, ladies and gentlemen. I am Michel Fabre, the Group CFO. Thank you for attending the conference call. I am with Olivier Duran and Marc Maier, our outstanding Deputy CFO and Head of Investor Relations. I will present our sales figures for the Q1. The press release was posted this morning at 7 am, Paris Time, on our website. As a slide show that now I am going to comment, it's also available on our website. Starting with Slide 2, I would like first to highlight the restatements that we have made to our 2020 accounts. As announced on February 18, we have signed a memorandum of understanding for the sale of our acoustics and soft trim the division AST to the Adler Pelser Group. All conditions are met to qualify the activity as discontinued in compliance with IFRS 5. Consequently, group sales in 2022 2021 excludes the ASE figures In previous periods, I restated and presented accordingly. I remind you that AST is posting circa €250,000,000 of sales with a low margin. As regard Q1 2020 sales We are estimated to €3,678,000,000 versus €3,739,000,000 as released in April 2020. The table at the end of this slide presents 2020 restated quarterly sales figures. Only interiors in Europe are impacted by this statement. Let's now on Slide 3, Start with the main highlights of our sales in Q1. Organic growth was strong at 12.2% With double digit organic growth for our 3 major business groups and close to 6% for Client Electronics, All sales were impacted by the shortage of retail components. We're estimating this impact on Clarion at around 5% of sales or €9,000,000 Organic growth was particularly strong in China with 88.4%. Of course, we must remember that last year, China was a country most impacted by the crisis in Q1, with sales down more than 40% versus Q1 2019. It is worth mentioning that sales of €670,000,000 in Q1 2021 even exceeded The €604,000,000 posted in Q1 2019 before the COVID. In every region, we posted stronger performance, Plus 5.90 basis points in Europe, plus 5.40 basis points in North America and largely over 1,000 bps in Asia and South America. Nevertheless, at group level, our organic growth of 12.2% It's slightly below the worldwide automotive production growth of 12.8% according to the latest IHS market data. As you perfectly know, this is due to the strong unfavorable geographic mix impact in the quarter, estimated at circa minus 900 basis points. This is partly due to the fact that Asia, the only region where automotive production grew during the quarter, Represented only 17% of Farfetchia sales in Q1 2020, while it represented 44% of worldwide automotive production. The generative mix effect will turn around to very positive in Q1 and positive in H1 As Faroesia is more exposed to Europe and North America, the two regions that will recover strongly versus the troughs of Q2 2020. Combined with the ramp up of the new seating programs, apart of which we start in Q2, We see an acceleration of outperformance in Q2 and we are more than on track to reach the targeted full year outperformance At least, sorry, 600 basis points. Apart from the sales figures, I would like to outline 2 events that happened in Q1. In February, fully in line with our strong conviction that hydrogen hydrogen is the best solution for 0 emissions, We acquired a major stake in CLD, which is one of China's largest high pressure tank manufacturers. CLT operates 2 plants, employs 200 people and has a capacity of 30,000 tonnes per year. In March, we successfully issued €400,000,000 of senior green notes due 2029 at 2.38%. The first issue of green bonds reflects Farfetchia's strong commitment to sustainable mobility And in particular to investment in hydrogen mobility. It is the best price that Faurecia ever gets on a bond issue Taking the maturity into the cards. Slide 4 shows So usual bridge of sales between Q1 2020 and Q1 2021. On the extreme left, We have just reminded the sales figure for Q1 2019 before the COVID-nineteen crisis. It shows that our main markets have not yet fully recovered The crisis and I will give you only one figure. Volumes in Q1 2021 are minus 11.6% versus 2019. So we are still in a very, very low market. We also reminded So Q1 2020 sales figure as presented last year that included sales for AST. Our Q1 2020 sales reflected for IFRS 5 Comparable to Q1 2021 amounted to €3,678,000,000 Currency effect was negative And quite significant, with €183,000,000 or minus 5% of sales, with the U. S. Dollar As a Brazilian real representing around 2 thirds of this figure. SCOFF effect was a positive contribution of €60,000,000 Due to 1 month of consolidation of SIS, the month of January, as SIS was consolidated last year from February 1. As previously indicated, organic growth in the quarter amounted to €450,000,000 or 12.2 percent of sales. As a result, sales in Q1 2021 amounted to €4,500,000,000 up 8.9% year on year on a reported basis. Let's start on Slide 5, the review by business group. Sitting, which represented 39 percent of group sales in Q1, posted sales of €1,544,000,000 Sales grew is a double digit on an organic basis at +13.6 percent. Organic growth was very strong in China, Both with international and Chinese OEMs, WestJet in other regions recorded organic growth at or above 5%. As already commented, significant SOPs will happen in Q2 and ramp up during the rest of the year, boosting sitting outperformance in the coming Interiors, which represented 30 percent of group sales in Q1, posted sales of EUR 1,225,000,000 Sales grew to double digit on an organic basis at +11.7 percent. Reported sales included a positive scope effect of €60,000,000 Or plus 5.4 percent of sales due to the additional months of consolidation of SIS already commented. At this positive scope effect in the full year of sales, a negative currency effect of €67,000,000 or minus 6% of sales. Organic growth was driven by China in Europe as well as SIS that grew by plus 30% on an organic basis. Let's continue on slide 6 with Clear Mobility and Cardio Electronics. Clear Mobility, which represented 26% of gross sales in Q1 posted sales of €1,048,000,000 Sales grew into double digit on an organic basis at Plus 12.3 percent, organic growth was mostly driven by China, up 84% and Commercial Vehicles, up 22%. Karyoelectronics, which represented 5% of gross sales in Q1, posted sales of €199,000,000 Sales grew by 5.7 percent on organic basis. Organic growth was mainly driven by China, where sales tripled year on year. The impact on Q1 sales of the shortage of electronic components was estimated at least €9,000,000 On Slide 7, there is a review by Vision. Europe, which represented 51% of gross sales in Q1, Posted sales of €1,970,000,000 reported sales included a positive cost impact of €35,000,000 of +1.9 percent of sales that slightly exceeded a negative currency effect of €28,000,000 or minus 1.5 percent of sales. Sales grew by 5% on an organic basis, outperforming by 5.90 basis points regional automotive production That dropped by 0.9%. Organic growth was mainly driven by City and Interiors. North America, Which represented 23 percent of group sales in Q1, posted sales of €952,000,000 Reported sales included a strong negative currency effect of €88,000,000 or minus 8.6 percent of sales That's largely offset the positive scope effect of €70,000,000 or plus 1.6 percent of sales is organic growth of €9,000,000 or plus 0.9 percent of sales. This strong negative currency effect resulted in a drop of 6.1% in sales on a reported basis. Sales grew by 0.9% on organic basis, outperforming by 540 basis points Regional Automotive Production. Organic growth was mainly driven by City. Let's continue on Slide 8 with Asia and South America. Asia, which represented 23% of gross sales in Q1, Posted sales of €928,000,000 Sales in the region grew by 48.7% on an organic basis, Outperforming regional automotive production by 1730 basis points. All business group Posted strong double digit growth, mainly driven by growth in China. In China, sales grew by 88 0.4% on an organic basis, outperforming regional automotive production by 480 basis points. All business group posted very strong double digit growth in the country. It is worth repeating that our sales, both in Asia and China, Significantly exceeded pre COVID sales of Q1 2019. South America, Which represented 3% of group sales in Q1, posted sales of €130,000,000 reported sales included a strong negative currency effect of €41,000,000 or minus 32 percent of sales. This strong negative currency effect largely offset a limited positive Scope of €1,000,000 As a result, reported sales were down 11.5% year on year. The 20.1 percent organic growth outperformed regional automotive production by 1610 basis points. Organic growth in South America was mainly driven by interiors and clean mobility. Now that we have reviewed our sales performance in Q1, let me on Slide 9 give a quick look back as a spin off process that happened in March and is now behind us. The distribution of Faroesia shares by Stellantis is completed and Faroesia is now a free float of circa 85 percent. Most of the remaining 15% relates to the stake held by the 4 historical shareholders of PSA and FCA, Which means, XOR, 5.5 percent Peugeot, 1810 with 3.1 BPI France with 2.4, Dongfeng with 2.2. As you know, all 4 shareholders We have undertaken a lock up agreement for a period of 6 months following the completion of the distribution by Cylantes. But of course, May decide to remind shareholders for a long period. Notably, Peugeot indicated its strong commitment to Faroesia And our shareholders as the next AGM will be asked to appoint the company Peugeot 1810 as a Board member With Robert Peugeot as permanent representative, and you know that Robert Peugeot has been involved for a long time Faurecia. We are proud to consider that the spin off process, which was a big event for Faurecia and all its shareholders, It was a success. Thanks to intense communication efforts from the company, including the Capital Market Debt to update on the group perspective As well as active investor meetings campaign and also further support from bank brokers, we have been able to create enough appetite From investors to absorb the significant Povatti shares. At the close of Friday, our share price was up 15.9% year to date, outperforming the SBF 2020 Index by 12.6% over the same period. I would like to thank all the team of Faurecia for this good performance. I would like to thank as well Our advisers and brokers, Lazar, Berenberg, JPMorgan, Citec General, for this, I will say very good performance. Now our share liquidity has significant increase with average daily volumes traded since the record date that have more than doubled versus volumes traded before the record date. Since March 22, our share is included in the CAC Next 20 Index. Our shareholder base is enlarged and more diversified. Lastly, let me remind you that our upcoming non dilutive employee shortage plan, named Forrezo, which served delivery on July 28. We also give opportunity to employees to become shareholders of the company With the targets that total shareholding of our employees will represent after this operation circa 2.6% of the capital of Faroesia. Let me now conclude on Slide 10 with a confirmation of all our financial targets for the year. The latest IHS forecast that was released last week estimates worldwide automotive production in 2021 At 79,700,000 vehicles, up 13%. This is downward revision of around 500 The 1,000 vehicles versus the previous forecast of March is a consequence of the shortage of electronic components that impacts all our customers. As you know, since February, our guidance for 2021 It was based on a cautious assumption of 76,600,000 vehicles to be produced in the world in 2021, An increase of 8% versus 2020. So this presence is giving us more than comfort Towards our guidances. Even taking into consideration the shortage of electronics and the subsequent downward revision of IFRS forecast, All our assumptions remain valid. As a consequence, I can, with great confidence, Fully confirm our targets for the full year. Sales of at least €16,500,000,000 With a strong performance of at least 600 basis points, operating margin of circa 7%, Close to private COVID levels, net cash flow of circa €500,000,000 and a debt debt to EBITDA ratio Of less than 1.5 times, clearly, all of these figures will be fully, I will say, achieved. Thank you very much for your attention. The floor is now yours. Operator, can we start the Q and A session? Ladies and gentlemen, we'll now begin the question and answer session. We have our first question from the line of Tom Nourien from RBC. Please go ahead. Your line is open. Yes, Tom Noreen, RBC. Thanks for taking the questions. Yes, good morning. Hi, hi. The first one, and I'm sure everybody has this question. Could you just give us a little more detail on your decision to maintain the 8% production guidance? I understand you're being prudent, but Maybe folks would appreciate some of the components there. Maybe what would it have been, let's say, there was no semiconductor production And then secondly, OEMs of late have been making a lot of comments On EV component insourcing, Daimler last week at their EQS event said they were going to be doing their own power electronics and e motors And Battery Management Systems. So it would appear that your seating and interior business could be okay there, but what about clean mobility? And then 3rd, the long term guidance issued at your CMD suggested Some pretty significant market share gains in North America in Seating and Interior, which you would think North America a pretty mature market. I understand you're underpenetrating there. But curious if you've learned anything new in Q1 That would suggest confidence that you could achieve those targets. Thanks. Thank you, Tom. Of course, we start with semiconductors because it's a big disturbance for the market, difficult To understand what are the arbitration inside, I would say, the suppliers, Arbitration inside the customers and because in some cases we have seen some customers favoring one region respect to others Oh, favoring some models, respect to others, so difficult to understand everything. The fact is that automotive business consumed more or less 10% of the semiconductors of this world. I can see it on the 10%, which is a big figure and a low figure. We can shout, we can say what we want. We are only at 10%. 2nd thing, We see some erratic communication. I remember one carmaker saying things are now competitive fixed The week after, it was making some downtime. So we are more today still at end to mouth, Very low level of inventories. And of course, it will continue like this probably some months. There will be potentially a peak this month and next month. If progressively things will probably be better, We know that in this business, Q3 is important for the consumer goods to prepare Christmas. And probably like last year, Things will freeze, right? You can use this expression. There will be some new CapEx, so we can be a little more optimistic for the last quarter. So we as Faurecia, what we can say that we remain, if you see, at the same horizon In our guidance, as of Q1, 19,000,000 vehicles. Probably it's very cautious per quarter, it's very cautious, but it's a fact. Everything, I will say, upwards will be an upside. And remind you the sensitivity I gave different times, 1,000,000 vehicles production more in this world means that with the same mix, means €200,000,000 of SaaS and close to €50,000,000 of EBIT. So clearly, The upside is significant. After that, we say month after month, we see how things will improve. On the big announcement of electrical vehicles, as usual, big announcement means 5 years lead time, I am sorry to say that. So we are speaking of 2025, 2026, etcetera. But what they will decide on is sourcing battery status, sorry, is not affecting Our working mobility business, what is key is how fast ICE Will be or could be substituted by electrical vehicles. And our fast hydrogen will develop because we are convinced And we are more and more convinced that Hydrogen is the only clean solution. So we are convinced that things will accelerate. So we are totally for the moment inside our guidance on the ICEs, the number of ICEs, etcetera For the period at least until 2025, we think that it will be probably more positive than we were thinking Farfetch. After that, we have to see, like you, our markets will evolve, which will be the evolution of the infrastructure. I doubt that electric infrastructure will fit the number of volumes that are expected as BEVs. And now market share gain. Sorry to be blunt, we are not speaking of the future. We have gained the market share. It's a fact. We are starting the business. We are starting a business, I would say, with Jeep, with Tesla, Tara is has been awarded in the last 2 to 3 years. So our growth In North America, it's secured. And of course, it's a daily, I will say, fight to continue to grow. I'll remind you that this year we have a EUR 26,000,000,000 order intake target. The good news that we give you is that we are Totally inside in our roadmap at the end of March. And I will add that for everything, we are at least In line with our road map, I would say, at the end of March. So the Q1 was a very positive quarter for Farvesia. Okay. Thank you. I'll turn it over. Thank you for your question. We have another question from the line of Giulio Pescatore from Exane. Please go ahead. Your line is open. Good morning, everyone. So my first question is on the 2021 guidance. Can you confirm that the assumption behind the guidance in terms of FX and scope are still the one that you made at the time of the full year earnings release? And then maybe if you could help us with the help us a bit with the assumption behind the free cash flow guidance as well. I mean, what are you assuming for working capital? And yes, that would be very helpful. And then maybe one last one more high level. I mean, are you seeing Anything in the way that the new Euro 7 regulation is shaping up that makes you more cautious or maybe even more optimistic About the outlook for the clean mobility segment in the midterm. Thank you, Giulio. For the ForEx, we kept 120 Dollars per euro and RMB 7.80 per euro, which are the main assumption. In U. S, the sensitivity is very low, We have more or less. So it's not a big problem. So today, when you see the figures, we are Firstly, we have an upside. Free cash flow guidance, we were not repeating the story of the restructuring cash out. It is a fact. So we'll be close to EUR 180,000,000 for this year cash out, fully taken into account. On the working capital, Thanks to the one day reduction in inventories, we should be steady positive. And I repeat, I would say around €500,000,000 cash flow knowing that we are better end of March And we are somewhere significantly better, which means that when we are disciplined and when we control the CapEx, we say things are visible. Regulations, it's too early to speak about regulations. There is an important step for 2025 With the AC, we see some polymix, we see some discussions. Sorry to say that we are not involved, moreover. So difficult Not to speak about that is too early. Okay. Thank you. Thank you for your question. We have another question from the line of Thomas Weston from Kepler Cheuvreux. Please go ahead. Good afternoon. Good afternoon. Three questions as well, please. First, can you say a few words about the business you've acquired in China? You said Quite a big production capacity in terms of storage system. Can you give us some maybe some revenues, some orders, Some ideas of what the contribution is going to be in 2022, 2025 or 20 Tati, is that the metric you want to follow as for the targets you had given for Hydrogen? That's the first one. The second, I'd like you to come back to the time line of the new contracts in seating And confirm that they are incremental in terms of profitability. And last, I'd like to come back to the On the available topic of various supply shortages, can you just help us understand The visibility you have in Q2 on production levels and what kind of impact on earnings You saw in Q1 or you anticipate in Q2, I understand it's within the guidance, but explain us how you can react to this very limited visibility. Thank you. Thank you, Thomas. Now, Silvi, it's a little early because we are still in the process of acquisition. Well, it's first of all, figures are low. I will say on assets, I think something like €30,000,000 But this is the only figure I can give you now. Sorry to say that. We have to go back to you with the closing of the acquisition. Setting profitability, I will say that the new contracts will at least give the same profitability as today. Growth, as you have understood, Thomas, will Be quite nice and sitting will definitely post a margin over 7%. Production level, we have a paradox. Of course, production level is low. And I repeat, Very low when we compare to 2019. So we are still in the very low range. So when things will restart, it will be quite impressive. I will say as well that inventories of our customers are very low. We are estimating that today Something like 1,000,000 cars, sorry to repeat this figure, circa 1,000,000 cars inventory are missing in the States. There are 40 days when they were usually at 45 days or more. So 45 days or more. So that means that clearly when Finks when semiconductors will be available, Finks will restart very, very I will set a very Dynamic pace. The paradox is that we are accelerating, I will say, our outperformance. So Thanks to the outperformance, we have accepted some plants. We don't have today any big issue as activity, This is a good thing. And this is helping and will continue to help, of course, our profitability. So as you know, we are active. So in region, because there are some regions, Germany, for instance, North of France, etcetera, Where production is low, of course, we have adjusted, we are adjusting our means. And in other regions, we have to manage today growth And to find the right people and to manage this growth. So we try to be as quick and agile as possible. Great. Thank you very much, Risso. Thank you for your question. We have another question from the line of Asher Gommel from Jefferies. Please go ahead. Good morning, Michel. Good morning. Thanks for taking my Good morning. I have also a few questions, please. The first one would be actually on the flowback versus share buyback. Did you utilize the full volume of your buyback volume around the flowback? Or is there something left on the table for the rest of the year? No, it's finished. So the share repurchase for the to avoid the dilution is done. It's I think concluded, if I'm not mistaken, it's in 1st day of Friday. So it was done. It has not matched the flowback. The flowback happened Probably before, when I see the transactions, so it was on top of that, it was not a bigger amount. So I think this was everything is done. I have no issue on that. Perfect. My second question would be a bit on working capital because, obviously, we ended the year 2020 at a Very high sales level and so very efficient working capital level. And now with all this volatility in the market And potentially some inefficiencies on the inventory side, how should we think about your working capital at the end of the first half? Do you see some burden from this current situation? Or are you able to manage that very efficiently right now? No. As I said, I think end of February, we have already achieved some inventory reduction, mainly in the last 2 months of the year. We saw again the cash impact afterwards. We are today targeting or if you prefer Forecasting the same level of working capital between end of June end of December, end of June 21 and end of December 2020. Okay. Very clear. And then my last question would be a follow-up on the seating market share you were talking about earlier. And I understand you already secured that market share. But since you're one of your main competitors in the U. S. Has fixed The operating problems and now also the balance sheet, do you think they'll become more aggressive again to try to regain some of the market share they lost? Oh, you think you can defend that very easily? It's a very good question. I would say that It's not only a question of the Q1. They were already back last year. At least they want to defend the market share, which is normal. We think that on metal, we have an advantage. We think that we are more, I would say, We have some patents. So we have a technical advantage and we'll continue to gain market share. It is what we see and what we will achieve. And I insist on the order book was very good in CV and for seating last year and this year it is starting very well. On Complete Seed, we are more an outsider. So we continue to gain some market share, right, I would say, with some customers. When we take market share with Tesla, for instance, it's a new one. So we are gaining, I would say, Progressively, but without making too much, I will say, damage to our big competitors. It is a combination of market share between 9% to 10% on the composite, while the market share on metal is much more. We are probably On the big platform at 20%. That's great. Thanks for all the color. Thanks, Michel. Thank you. Thank you for your question. We have another question from the line of Steven Reitman from Societe Generale. Please go ahead. Hi. Good morning, Michel. Good morning. Good morning. The question, the We've seen so far indications that the automakers have been able to favor their more Higher contribution margin vehicles, and so they're not taking so much of a hit in the Q1 from the semiconductor shortage. How are you adapting to this as well in terms of as they reduce certain programs and try to concentrate on other ones? And are you able also to try to match that, do you believe? Thank you. I don't want to speak for my customers, but I think what you have said and noted is completely true. We think that they are favoring some models or some regions. When we say favoring, that means they keep The same volumes as before. So and we have not seen some up and downs around that. So Clearly, it was not a difficulty to fit the requirement, obviously, the production requirements for these models that they have favored. The problem is more when they stop production overnight. It happened. But to be clear, it happened. Our customers have some difficulties. It happened. We are a just in time company. We try to be agile. So we adapt as quick as possible. But sorry to say that, contractually, if they stop overnight, they have to compensate. So it is what is happening. It is a famous quote you say, which we speak claims story. We ask for compensation. Our compensation usually is to This postponed some productivity, but we cannot accept that the stop overnight, we have to we need 2 days, 3 days, to, I will say, organize the downtime of our people. So this is a fact, Which is a consequence, I don't know if it was a question, but it's a consequence of the fact that visibility of our customers Very limited. It's very limited. And it might be early days at the moment, but there has been talk that the automakers are looking now to Getting more involved in the sourcing of key components like semiconductors as well to ensure that the Tier 1 suppliers and whatever I have adequate suppliers. Can you see anything from a clearing perspective on that? No, Positivam is not. Of course, they want to be more involved with a change which is complex because you have at least Two types of suppliers. I'm not an expert, but I know that some processes, which are very CapEx intensive, are very much concentrated. Just to that, you have some, I would say, suppliers making the final assembly and welding point. So it's a protection. I don't know how they could manage that or they are prepared, Sorry to say that and to manage that. But for the moment, we don't see any consequence. We are more working many years for Clariant with Nissan to manage the shortage And to avoid any disruption for our carmakers. Thank you. Thank you for your question. We have another question from the line of Jose Asmundi from JPMorgan. Please go ahead. Good morning, Jose. Good morning. Thank you very much. Just a few items, please. The first one, if you come back a little bit more to Clarion and any news in terms of product development On the display side or RFQs or business wins by region that you have seen sort of developing in the past quarter? Second question around the CapEx guidance, maybe for the first half, where do you see CapEx for the first half? And then the third one, I know it's difficult to quantify the situation on the semiconductor supply chain issues. But Can you comment a little bit around versus your initial assumptions for the Q2 or for the full year, how far have you reduced Your internal budgeting production forecast for the year versus where you were maybe in December? Thank you. Okay. Display, we don't comment, sorry, Jose, The only thing I have given is that we are totally in the roadmap towards the 26, and we continue to be awarded on some display. What I can say today. CapEx guidance, this year will be maximum EUR 600,000,000 of CapEx, That's probably below. As we say, half of it is the first half, mainly because we have been restrictive. So I don't think we will be over €400,000,000 Q2, the paradox in Q2 is that, sorry to say that, Jose, you will be disappointed, But we are totally in line with our budget. Very good. Our budget was made on 19,000,000 cars, And we are totally in line with our budget. I have the figure with me. I am sorry. We can give you because it's a budget. We are €18,000,000 above our sales on the respective budget with the last forecast of our customers. Thank you. Can I follow-up on the Chinese momentum sequentially on a quarterly basis? Are you seeing a big slowdown as we go into Q2, Q3, Q4, are you seeing much more of a stable pattern versus the Q1? What's your sense overall of your Chinese business? Do you think it's slowing down or anything Stabilizing or do you think it's actually accelerating versus Q1? Q1 was very good. Q2 is below. Q2 is below. We see every month of small upside is a program, but Q2 is still below. So Difficult to comment if it is a more cautious forecast or is there was a problem of inventories or a problem, A question of inventory to boost in the Q1, but you're right, Q2 is steady below. It's too early to speak of Q3, Q4. So today, we have no concern about our expectations for China in the full year. We are above. After that, we have we need to see what will be still the upside with respect to that. Thank you for your question. We have another question from the line of Martin Demborgi from Equity. Please go ahead. Yes. Good morning, everybody. Martin, please. Good morning. The first question is a Follow-up on the seating because you are starting new programs, but could you quantify the impact starting from Q2 this year And on next year in terms of sales coming from these new programs, justifying the strong outperformance. The second is on the Asian operating profit. I suppose This year will exceed the double digit threshold. Could you elaborate on the potential target in terms of Fitability with a very rough range for this year. And the third question is on the hydrogen business. You guided for €50,000,000 including tanks and stocks. So far, Stellantis made the announcement. But how many clients you need to achieve these targets you are guiding for 2022? Okay. Marc, do you have the figure for the Citi? No, I will take afterwards. I will check Mark, yes? Mark is not connected, sorry. First 15 sorry, I will give you the figures. You stay for the business starting in Q2 or for the total new businesses? No. Starting from Q2 for the rest of the year, how much is the business coming from these new programs? We are actually speaking of a little more than €400,000,000,000 So sorry, I could not be on the line. Yes, exactly correct, Michel. We are slightly We are at 350 or slightly above. Thank you, Marc. On Asia, we will definitely post double digit figures. Sorry, I will not give more flavor on that. But we are as you understood, we had a very good Q1 in China. So forecast is not bad at all. So we are clearly more than in line with our roadmap. On 2022, things are done. So clearly, the main business in 2022 is PSA, The commercial vehicles for both tanks and stock. And the Hyundai business will Start, I would say late 2022, if I'm not mistaken. And this is as well stock and tax. After that, we have the Renault business, which is today Tonks. We are still developing the stack. We'll see how things will evolve with Renault According to that project, because as you know, they have made a JV with Placor. So there is there for the short term, medium term, the free key customers. You have, as you know, at least 2 years. So So what we will be awarded this year, and you know that some important RFQs, because for competitions are today on the table, This will mainly impact 2024 onwards. Okay. So you already covered this target. Okay. Thank you. If you don't mind, for you to give me this opportunity, 2021, 2022 is made. We know where we have been awarded. We know what we have to do. So after that, of course, Volumes mix could play, but we have we know the content of ourselves. 2023, there will be a small impact from the Order intake of the first half twenty twenty one, etcetera, on the rolling point of view. And I remind you my guidance for 2025, I said that 2 thirds are totally secured, 1 third will be secured with the order intake of 2021, 2022, mainly Small impact of first half twenty twenty three. Thank you for this question. Thank you. Thank you for your question. There are no further questions. I will hand back over to Michel Feve. Okay, thank you to all of you. So as you can see, we have we made a very good Q1. We are totally inside our roadmap. So we continue, I would say, to deliver and to be focused and agile because the market is not Easy to deal with the semiconductors. I think these topics will continue probably to the end of the Q3 September. And what I think is that things will restart smoothly in the H2. So probably we have an upside in H2. It is, if I can want to give a very positive message, it is my conviction. Thank you to all of you and see you soon. That concludes the conference for today. Thank you for participating. You may all disconnect.